Question

According to the graph of the production possibilities frontier, what is the opportunity cost of the fourth widget?

a) Constant opportunity cost
b) Increasing opportunity cost
c) Decreasing opportunity cost
d) Zero opportunity cost

Answer 1

The opportunity cost of the fourth widget cannot be determined based on the given information.

Step-by-step explanation:

The opportunity cost of the fourth widget according to the production possibilities frontier (PPF) can be determined by analyzing the slope of the PPF. If the slope of the PPF is constant, then the opportunity cost is constant. If the slope of the PPF is increasing, then the opportunity cost is increasing. If the slope of the PPF is decreasing, then the opportunity cost is decreasing. If the slope of the PPF is zero, then the opportunity cost is zero.

In this case, the question asks for the opportunity cost of the fourth widget. Without the specific graph of the production possibilities frontier, we cannot determine the exact slope of the PPF. Therefore, we cannot determine the opportunity cost of the fourth widget. The correct answer would be that it is unknown or cannot be determined based on the information given.